Doug writes:>So, translating into demotic English - one of the most
aggressive easing streaks in Fed history will have no effect, and there will
be no recovery anytime soon?<

the cuts have already had an effect in the U.S.: they propped up the asset
values of housing and the stock market, which has so far prevented the
recession from being worse.

To my mind, we may have a recovery (in the U.S.), but it won't be fast
enough to keep unemployment rates from continuing to rise for a year or two.
Further, in line with Godley/Izureta analysis, excessive private-sector debt
(and U.S. external debt) and the synchronization of a lot of countries'
recessions make it quite likely that this recovery will part of a
"Dubya-shaped" process, i.e., a temporary boom that follows a recession and
is followed by another (as with the temporary 1981 boom). Private sector
debt becomes more important if unemployment continues to increase.